Cryptocurrency: With Inequality Rising, Citizens Seek Alternative Economies

The year 2017 will go down as a particularly tough one for ordinary citizens, particularly in the global South. A sharp rise in government restrictions on fundamental freedoms across regions, as well as in levels of inequality, played a big part in that negative review.

According to a recent Oxfam report, 1% of the world’s richest elites now own 82% of the world’s wealth, with a dollar billionaire having been created every two days in 2017.

But we are witnessing people actively fighting back against a system that largely favors the super-rich at the expense of everyone else. According to the CIVICUS Monitor, an online tool that tracks threats to civil society in every country, there were at least 42 reports of activism leading to positive developments for civic space in 2017.

However, it’s not only activists challenging the status quo. Also, ordinary citizens are doing so by turning to innovations that promote alternative economies — such as ‘sharing economy’ platforms and cryptocurrencies, for example – to enable them to function in countries where repression is commonplace and only the rich can transact.

 

Sharing economy, sharing rewards

In addition to global enterprises like Uber and Airbnb, that are growing more rapidly in developed countries, sharing economy platforms are also being adapted to meet the needs of citizens in developing societies – particularly those in which the right to speak out openly, assemble peacefully, and organize around issues is not respected.

In these nations, sharing economy platforms often act as hybrid marketplace models involving both paid-for and gifted services shared across a particular network and free of state intervention.

Comunidas, a platform launched by CIVICUS’ Innovation for Change – Latin America and Caribbean (LAC) program offers a catalog of services for LAC civil society organizations willing to be exchanged by the organizations that make up the community.

In this context, Comunidas and similar models are able to address the demand for services among LAC Civil Society Organisations – and their lack of funding to access them – by tapping into a highly skilled marketplace willing to donate or exchange pro-bono services.

 

Crypto-power to the people

Japan Bitcoin Mt Gox

Attendees of the Inside Bitcoins conference in Berlin examine Bitcoin buttons. (AP/Frank Jordans)

Powered by Blockchain technology, cryptocurrencies have also had success in developing countries. Because of the immutable nature of Blockchain, cryptocurrencies are able to help recipients of foreign aid by allowing them the opportunity to exchange peer-to-peer, rather than having to transact through bureaucrats, which in many cases would leave them exposed to extortion, bribery, and other forms of corruption.

Cryptocurrencies also operate on a global marketplace, effectively combating the inflation that many living in lower-income countries may face and that renders their national currencies useless. BitPesa, M-Pesa, and MicroMoney are actively being used in African and Asian countries to send cryptocurrencies both domestically and internationally.

In fact, even the UN is experimenting with sending the cryptocurrency Ethereum to 10,000 refugees in Jordan because it can be exchanged via mobile phone.

Cryptocurrencies and sharing economy models are not perfect, nor are they the only solutions for civil society, which can already be seen fighting back in 2018. Ensuring that sharing actually takes place among groups and individuals that lack the time and manpower to deliver services is a challenge for many sharing economy platforms.

Similarly, the volatility of the marketplace along with the lack of understanding of how cryptocurrencies work, represent drawbacks for cryptocurrencies and those who trade them.

Yet as billionaires dominate headlines and the 1% of the global population make critical decisions in Davos that affect everyone else, it is important to note that alternatives for citizens, activists, and organizations exist.

Due to the high mobile penetration rates, even among developing countries, such alternatives are easier to access now than ever. 

Top Photo | In this Friday, Dec. 8, 2017, file photo, a man uses a Bitcoin ATM in Hong Kong. Bitcoin is the world’s most popular virtual currency, but multitudes of alternatives are springing up around the world. (AP/Kin Cheung)

Elizabeth Stephens is Communications Coordinator with global civil society alliance, CIVICUS’  Innovation for Change project.


OpenDemocracy is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

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